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Consolidated Rail Corp. v. Grand Trunk Western Railroad Co.

United States District Court, E.D. Michigan

August 12, 2013

CONSOLIDATED RAIL CORPORATION and NORFOLK SOUTHERN RAILROAD COMPANY, Plaintiffs/Counter-Defendants,
v.
GRAND TRUNK WESTERN RAILROAD COMPANY, Defendant/Counter-Plaintiff/Third-Party Plaintiff,
v.
CSX TRANSPORTATION, INC., Third-Party Defendant

For Consolidated Rail Corporation, Plaintiff, Counter Defendant: Laurence Z. Shiekman, Pepper, Hamilton, Philadelphia, PA; Matthew J. Lund, Pepper Hamilton LLP, Southfield, MI.

For Norfolk Southern Railway Company, Plaintiff: Matthew J. Lund, Pepper Hamilton LLP, Southfield, MI.

For Grand Trunk Western Railroad Company, Defendant, Counter Claimant, Counter Defendant, ThirdParty Plaintiff, ThirdParty Defendant: Daniel D. Quick, Dickinson Wright, Troy, MI; Doron Yitzchaki, Dickinson Wright, Ann Arbor, MI; James E. Lozier, Dickinson Wright, Lansing, MI.

For CSX Transportation, Inc., CSX Transportation, Inc., ThirdParty Defendant: Matthew J. Lund, Pepper Hamilton LLP, Southfield, MI.

For Grand Trunk Western Railroad Company, Counter Defendant: Daniel D. Quick, Dickinson Wright, Troy, MI; James E. Lozier, Dickinson Wright, Lansing, MI.

OPINION

Honorable Nancy G. Edmunds, United States District Judge.

Page 723

ORDER DENYING GRAND TRUNK'S RENEWED MOTION FOR JUDGMENT AS A MATTER OF LAW OR, IN THE ALTERNATIVE, FOR NEW TRIAL OR REMITTITUR [229]

This case's central issue has been whether Plaintiffs Consolidated Rail Corporation

Page 724

and Norfolk Southern Railroad Company (" Plaintiffs" or " Conrail" ) had the right to use Defendant Grand Trunk's tracks to cross a property either called " Trenton Steel Warehouse" or on which " Trenton Steel Warehouse," a building, was located, to serve non-party E.C. Korneffel Company, not located on the property at issue. From March 6 to March 16, 2012, the Court held a jury trial on whether Conrail or Grand Trunk breached the contract establishing the traverse rights, the 1996 Trackage Rights Agreement (1996 TRA). On March 16, 2012, the jury returned a verdict in Conrail's favor. The jury determined that Conrail (as agent for Norfolk Southern (NS) and CSX Transportation (CSX)) had the right to use Grand Trunk's tracks to serve Korneffel. (Dkt. 206.) The jury found that NS and CSX suffered damages as a result of Grand Trunk's preventing Conrail from delivering freight to Korneffel. ( Id. ) The jury awarded NS $39,816.80 and CSX $189,351.76. ( Id. )

Before the Court is Grand Trunk's motion for judgment as a matter of law, or alternatively, for a new trial or remittitur. (Dkt. 229, Grand Trunk's Mot.) Grand Trunk first argues that it is entitled to judgment as a matter of law because the 1996 TRA only grants Contrail the right to serve Huron Valley Steel (HVS) (a steel company on the property) or its successor and the Court and the jury impermissibly rewrote the 1996 TRA. ( Id. at ii.) Grand Trunk then argues that it is entitled to a new trial because the verdict was against the great weight of the evidence and because the Court improperly admitted Plaintiffs' damages evidence. ( Id. ) Grand Trunk lastly argues that is should at least be entitled to a new trial on damages or remittitur. ( Id. )

The Court does not find Grand Trunk's arguments persuasive. The Court recognized and recognizes again that the issues presented in this case were close and contested, but the Court found that the 1996 TRA was ambiguous and submitted the case's central issue to the jury. After a ten-day trial, with both sides presenting testimony and submitting evidence to support their positions, the jury found Plaintiffs' arguments more persuasive. Evidence exists that supports Plaintiffs' position. The Court therefore will not disturb the jury's verdict. Nor will the Court grant Grand Trunk a new trial, much for the same reasons. And the Court finds that Grand Trunk is not entitled to a new trial on damages or remittitur--the Court properly admitted Plaintiffs' damages witnesses and Grand Trunk had the opportunity, through cross-examination, to challenge the damages calculations. Grand Trunk did not sway the jury with its argument.

For those reasons, and the reasons more fully addressed below, the Court DENIES Grand Trunk's renewed motion for judgment as a matter of law or, in the alternative, for new trial or remittitur.

I. Standards

A. Rule 50 standard

" Rule 50 limits renewed motions for judgment as a matter of law to issues that were previously raised." Hillside Productions, Inc. v. County of Macomb, 06-11566, 2008 WL 4058512, at *3 (E.D.Mich. Aug. 28, 2008) (citing Fed.R.Civ.P. 50(b) and American and Foreign Ins. Co. v. Bolt, 106 F.3d 155, 159-60 (6th Cir. 1997)). A judgment as a matter of law in a jury trial, " is not available at anyone's request on an issue not brought before the court prior to submission of the case to the jury." Id. (citations omitted). " A post-trial motion for judgment can be granted only on grounds advanced in the pre-verdict motion." Id. (citation omitted).

Page 725

" Judgment as a matter of law may be granted if, when viewing the evidence in a light most favorable to the non-moving party, giving that party the benefit of all reasonable inferences, there is no genuine issue of material fact for the jury, and reasonable minds could come to but one conclusion in favor of the moving party." Balsley v. LFP, Inc., 691 F.3d 747, 757 (6th Cir. 2012) (quoting Barnes v. City of Cincinnati, 401 F.3d 729, 736 (6th Cir. 2005)). Where a party raises a Rule 50(b) motion on the basis that the jury's decision was against the weight of the evidence, " [t]he evidence should not be weighed, and the credibility of the witnesses should not be questioned. The judgment of [a] court should not be substituted for that of the jury[.]" Id. (Citation omitted).

B. Rule 59 standard

Rule 59 permits a court to " grant a new trial on all or some of the issues-and to any party-" after a jury trial, for any reason for which a new trial has . . . been granted in [federal court,] and in a " non jury trial, for any reason for which a rehearing has . . .been granted . . . in federal court." Fed.R.Civ.P. 59. " Generally courts have interpreted this language to mean that a new trial is warranted when a jury has reached a 'seriously erroneous result as evidenced by (1) the verdict being against the weight of the evidence; (2) the damages being excessive; or (3) the trial being unfair to the moving party in some fashion; i.e., the proceedings being influenced by prejudice or bias." Holmes v. City of Massillon, Ohio, 78 F.3d 1041, 1045-46 (6th Cir. 1999) (citations omitted).

C. Remittitur

Generally, a court will not set aside or reduce a jury verdict or find it excessive " unless it is beyond the maximum damages that the jury could find to be compensatory for a party's loss." Sykes v. Anderson, 625 F.3d 294 at 322 (6th Cir. 2010) (citations omitted). A district court has discretion to remit a compensatory damages " verdict only when, after reviewing all the evidence in the light most favorable to the prevailing party, it is convinced that the verdict is clearly excessive; resulted from passion, bias, or prejudice; or is so excessive or inadequate as to shock the conscience of the court." Id. (citation omitted). " If there is any credible evidence to support a verdict, it should not be set aside." (citation omitted).

II. Analysis

A. Defendant is not entitled to judgment as a matter of law or a new trial because Plaintiffs presented evidence at trial that supported their case

Grand Trunk argues that it is entitled to judgment as a matter of law because the 1996 TRA only grants Conrail the right to serve HVS or HVS's successor. (Dkt. 149, Grand Trunk's Mot. at 3.) Grand Trunk first explains that the TRA's plain terms solely grant Conrail the right to serve one specific customer. ( Id. ) Grand Trunk then goes through an exhaustive recitation of Michigan contract interpretation law. Grand Trunk does so to argue that the TRA is unambiguous and reads the way Grand Trunk has allegedly argued throughout the entire case.

Plaintiffs argue that evidence supports the jury's finding at trial, that Grand Trunk is impermissibly offering a new interpretation of the 1996 TRA, and that, even if the Court entertained the new interpretation, the Court has already considered and rejected this alleged new interpretation.

The Court rejects Grand Trunk's argument, again. On January 6, 2012, the Court addressed the parties' arguments as

Page 726

to the central issue in this case: whether the 1996 TRA gives Conrail the right to access the entire property owned by Huron Valley Steel on Grand Trunk's sidetrack, as Plaintiffs contend, or just the specific warehouse facility, as Grand Trunk maintains. (Dkt. 149, January 6, 2012 Order at 7.) The Court held that the TRA was ambiguous. The Court described the parties' TRA background:

On May 1, 1996, Plaintiffs and Defendant entered into the " Trackage Rights Agreement Between [Defendant] & [Plaintiffs] to Service Trenton Steel Warehouse" (" 1996 TRA" ). The 1996 TRA states, " [Plaintiffs] wish to effectuate the Arbitration award by reaching agreement on terms to use the certain portions of the aforesaid line of railway of [Defendant] and [Defendant] is willing to grant such use on the following terms and conditions . . . ." Section 1 of the 1996 TRA explicitly states that Plaintiffs have the right to use certain segments of Defendant's railroad " for the sole purpose of serving Trenton Steel Warehouse [(TSW)] or its successor." Section 6 of the 1996 Agreement delineates restrictions on use. This section states:

The Trackage Rights herein granted are subject to the following restrictions: (a) [Plaintiffs] shall use the Trackage for the sole purpose of delivering or picking up rail cars to and from (including the switching of such cars) [TSW] located adjacent to " FN." . . .
(c) Except as provided in above subparagraph (a) [Plaintiffs] shall not move any rail cars of any kind, other than those cars moving to or from [TSW] or perform any local freight or switching service of any kind whatsoever, and shall not serve any other rail customers along the Trackage.

Additionally, the 1996 TRA provided that Plaintiffs must pay Defendant a monthly retainer fee as well as certain rates " for each rail car loaded or empty delivered to or spotted" at TSW. (Dkt. 149, January 6, 2012 Order at 4-5.)

The Court then discussed:

Looking at the contract itself, " Trenton Steel Warehouse" appears four times in the TRA. It first appears twice in titles of the TRA itself, which read " Trackage Rights Agreement Between [Defendant] & [Plaintiffs] to Service Trenton Steel Warehouse" and " General Conditions to Trackage Rights Agreement Dated as of May 1, 1996, Between [Defendant] and [Plaintiffs] Relating to Trackage Rights for [Plaintiffs] to Service Trenton Steel Warehouse at Trenton, Michigan." Third, in Section 1, the TRA states:
[Defendant] hereby grants to [Plaintiffs] the right to operate . . . in either direction over the following segments of [Defendant]'s railroad for the sole purpose of serving Trenton Steel Warehouse or its successor (hereinafter referred to as 'Industry'), shown on the plan attached hereto, made a ...

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